FGV: Industry confidence drops 3.6 points in November

The Industry Confidence Index (ICI), released today (28) by the Brazilian Institute of Economics of the Getulio Vargas Foundation (FGV Ibre) recorded a drop of 3.6 points in November, reaching 92.1 points. In quarterly moving averages, the index fell by 2.7 points. According to institute economist Stéfano Pacini, this is the worst result since July 2020.

“Industry confidence fell for the third consecutive month and second in a widespread way among the surveyed segments. Perceptions of the current situation deteriorate due to a worsening demand and consequent increase in inventory levels, the highest since the lockdown“, said.

According to him, the future outlook is also low. “In addition, there is a worsening of expectations for the coming months, possibly related to a predicted global slowdown and a Brazilian economic scenario of uncertainties for the beginning of next year”, he explained.


The indicator showed a drop in confidence in 14 of the 19 industrial segments monitored by the Survey, in November. In comparison with the same month last year, the drop was 9.7 points.

The Current Situation Index (ISA) dropped 4.6 points, to 91.8 points, and the Expectations Index (IE) dropped 2.4 points, going to 92.6 points. The two are at the lowest level since July 2020, “a critical period of lockdown of the Brazilian pandemic”, according to FGV Ibre, when restrictive measures were in force due to covid-19.

Among the ISA components, the biggest negative influence came from the indicator that measures the perception of demand at the moment, with a drop of 6.6 points in the month, to 91.5 points. The perception of businessmen in relation to the current business situation also worsened, with a decrease of 4.9 points, to 89.7 points.

Inventories deteriorated slightly, rising 1.6 points in November to 104.8. Above 100 points, this indicator indicates that the industry is operating with inventories above the desirable level.

In expectations, the main influence of the month was the business trend for the next six months. The 4.5-point drop to 87.8 points has kept the indicator below 100 points since September 2021.

Over the three-month horizon, employment prospects fell for the second time in a row, with 2.5 points less, to 99.3 points. It is the first time in seven months that the indicator has been below 100 points, considered the neutral level.

According to FGV Ibre, this signals a “slowdown in hiring in the coming months”. The indicator that measures perspectives on production for the next three months remained stable at 91.1 points for the third consecutive month.

The Industry Installed Capacity Utilization Level (Nuci) dropped 0.9 points and reached 79.8%, the same level observed in April this year.

Translated to english by RJ983

From Brazil, by EBC News